Exhibit
10.7


 


 


Certain
confidential portions of this Exhibit were omitted by means of asterisks in
lieu of the text (the “Mark”). This Exhibit has been filed separately with the
Secretary of the Securities and Exchange Commission without the Mark pursuant to
the Company’s request for confidential treatment pursuant to Rule 406 under the
Securities Act of 1933, as amended.


 


MERCHANT
PROCESSING AGREEMENT


 


This Merchant Processing Agreement, together with
Schedules A and B attached hereto and incorporated herein (“Agreement”) is made
and entered into this 1st day of, April, 2002 by and between KeyBank
National Association, a national bank with its principal office located in
Cleveland, Ohio (“KeyBank” ), and Heartland Payment Systems Inc. (“HPS”), a
Delaware Corporation with its principal office located in Princeton, New
Jersey.


 


RECITALS


 


WHEREAS, KeyBank has established a credit card
merchant processing program (“Program”) whereby KeyBank provides processing and
related services for merchants which accept, as a method of payment for goods
and services, Visa, MasterCard and other proprietary credit cards approved for
acceptance by KeyBank; and


 


WHEREAS, the Program is operated in conformity with
applicable by-laws and regulations of Visa U.S.A., Inc. (“Visa”) or its
successor, and MasterCard International, Inc. (“MasterCard”) or its successor
and regulations of governmental agencies; and


 


WHEREAS, KeyBank is a member of Visa and MasterCard;
and


 


WHEREAS, Heartland Payment Systems, Inc. will from
time to time enter into contracts with individual clients (“Clients”) to
provide merchant processing services consistent with the Program to said
Clients (“Plan”); and


 


WHEREAS, Heartland Payment Systems, Inc. has entered
into an agreement with Vital to provide various services related to the Plan,
including but not limited to risk management, front-end and back-end
processing, and merchant chargebacks; and


 


WHEREAS, Heartland Payment Systems, Inc. desires to
have KeyBank perform certain other processing and related services of the
Program which are applicable to the Plan and which are set forth on the
attached Schedule A (Description of Services, Fees and Charges) and on such
additional schedules as the parties mutually agree upon.


 


NOW, THEREFORE, in consideration of the mutual
promises of each, the parties agree as follows:


 


1

















 


ARTICLE I

RIGHTS, DUTIES, AND RESPONSIBILITIES

OF PARTIES RELATED TO THE PLAN


 


1.1.          General


 


(a)           KeyBank
will perform such processing and related services as are applicable to HPS’s
Plan as set forth in Schedule A.


 


(b)           KeyBank
will process HPS’s Plan in accordance with accepted industry standards and in a
manner that is consistent with the existing care and attention used for its
current portfolio.


 


(c)           HPS
acknowledges and agrees that its obligations hereunder and in connection with
the Plan include compliance with:


 


(i)            all
state and federal laws and regulations which affect the Plan; and


 


(ii)           applicable
by-laws and regulations of Visa and/or MasterCard, including but not limited
to, providing to KeyBank any information regarding HPS or its Clients requested
by KeyBank that is required to be provided to Visa and/or MasterCard.


 


(d)           HPS
will pay KeyBank charges as set forth on attached Schedule A in the manner as
set forth in Section 1.5.


 


(e)           HPS
will, at its expense, administer the Plan in accordance with established risk
management practices and take or cause to be taken any such additional action
as may be appropriate or necessary to protect KeyBank against any loss as a
result of abuse, or fraud on the part of any Client.


 


(f)            HPS
has received, and understands and agrees to comply fully with all by-laws and
regulations of Visa and MasterCard, including but not limited to, rules
regarding independent sales organizations and member service providers.


 


(g)           HPS
shall be responsible for all actions or failure to act by Vital in compliance
with any of the requirements set forth in this Agreement.


 


(h)           HPS
represents that it maintains a sales office at 343 West Bagley Road, Suite 400,
Berea, Ohio 44017, and sales representatives throughout the United States. HPS
agrees that it will provide KeyBank with written notice of any sales locations
or any changes in the location of its current sales office. In addition, HPS
shall disclose the following on all statements, marketing and other materials
delivered to Clients the following disclosure: “Visa and MasterCard services
provided through KeyBank National Association”.


 


(i)            In
the event of any inconsistency between any provision of this Agreement and the
by-laws and regulations of Visa and/or MasterCard, the by-laws and regulations
of Visa or MasterCard in each instance shall be afforded precedence and shall
apply.


 


2

















 


(j)            HPS
acknowledges and agrees that Visa and MasterCard are the owners of their
trademarks and service marks, that HPS will not contest the ownership of such
marks, and that Visa and MasterCard each has the right to immediately and
without advance notice prohibit HPS from performing any further service or
activity relating to use of their respective marks and the operation of their
programs should HPS be deemed by Visa or MasterCard to have violated any Visa
or MasterCard by-law or regulation relating to its performance as an
independent sales organization or as a member service provider.


 


(k)           KeyBank
and HPS agree that in performing their responsibilities pursuant to this
Agreement, they are in the position of independent contractor. This Agreement is
not intended to create, nor does it create and shall not be construed to
create, a relationship or joint venture or agency or any association for profit
between KeyBank and HPS. HPS is not authorized thereunder to hold itself out as
an agent of KeyBank or to inform or represent that HPS has authority to bind or
obligate KeyBank or to otherwise act on behalf of KeyBank.


 


1.2.          Client Relationship Requirements


 


(a)           HPS
must satisfy in full the requirements attached in Schedule B before any Client
may become a participant in the Plan. Changes to the requirements must be
documented by HPS and forwarded to KeyBank for review. No changes in the
requirements set forth in Schedule B shall be effective as to KeyBank until
approved by KeyBank in writing.


 


(b)           HPS
shall solicit applications from eligible merchants at HPS expense, and shall
provide each applicant with application materials. HPS shall collect completed,
signed application materials from applicants and shall forward such application
materials to KeyBank or to such other place as KeyBank may designate.


 


(c)           HPS
shall underwrite each application to determine whether each applicant is an
eligible merchant, and if in compliance with the attached underwriting
requirements (attached hereto as Schedule B) may then be added as an approved
merchant to the program and commence processing. HPS shall promptly terminate
and remove from the program any applicant that is rejected by KeyBank. KeyBank
may obtain credit reports and such other information, as it deems necessary or
appropriate to review and underwrite all completed application materials in
accordance with the merchant processing policy. HPS will monitor on-line, and
other activity, reports on a timely and regular basis for suspicious client
deposit activity.


 


(d)           KeyBank
reserves the right, in its sole and absolute discretion to (i) change the
merchant processing policy, (ii) reject the application of any applicant who
KeyBank determines, in the good faith exercise of its underwriting judgment,
fails to satisfy KeyBank’s merchant processing policy, and (iii) terminate the
merchant processing agreement with respect to any merchant when KeyBank, in
good faith, determines that termination is appropriate under KeyBank’s merchant
processing policy and the terms of the merchant processing agreement.


 


3

















 


(e)           Notwithstanding
any agreement between HPS and Vital to the contrary, HPS shall be responsible
for any loss or damage to KeyBank, its subsidiaries, affiliates, employees,
officers, directors, successors or assigns may sustain as a result of any
chargebacks, returns, merchant or customer fraud, or any other loss or damage
with respect to HPS Plan. HPS will monitor online and other activity reports on
a timely and regular basis for suspicious Client deposit activity.


 


1.3.          Client Termination


 


KeyBank reserves the right to terminate any Client
from the Plan upon a determination that there is reasonable cause to believe
that the Client represents an unfavorable credit risk including but not limited
to items in Section 1.2(b) to KeyBank or HPS. KeyBank agrees that as a
condition to exercising such right, it will notify HPS of its intent to
terminate such Client and provide HPS with the opportunity to consult with
KeyBank regarding the intended termination. Nothing in this Section 1.3 shall,
however, operate as a limitation on KeyBank discretion in terminating a Client
and shall not limit KeyBank’s ability to suspend deposits to a Client’s account
if such action is deemed necessary or appropriate by KeyBank.


 


1.4.          Liability for Source Documentation


 


HPS shall bear any liability for source documentation
or data as specified in Section 1.8. Failure to provide requested source
documentation (including sales draft copies, if available) on a timely basis
will result in HPS’s assumption of liability in settlement of cardholder
disputes and KeyBank shall have the right to charge the full amount of the
transaction in question to the Settlement Account (as defined in Section
1.5(a)). The data and information received by KeyBank pursuant to this Section
is the property of KeyBank.


 


1.5.          Accounts


 


(a)           HPS
will establish, or has established, a settlement account with KeyBank which
will be named “Heartland Payment Systems Commercial Customer Trust Account,”
pursuant to the terms of a deposit agreement between HPS and KeyBank (the
“Settlement Account”). This account will be used for the settlement of Clients’
Visa and MasterCard transactions and to settle fees, charges, interchange fees
and reimbursements due to KeyBank hereunder. KeyBank will furnish monthly
billings for all Plan services rendered and charges incurred by HPS hereunder.
KeyBank’s fees, chargebacks, charges, reimbursements, and interchange fees will
be charged to the Settlement Account once per month via a debit based on the
detail provided by the account analysis five (5) business days after providing
HPS with such detail. HPS agrees to have sufficient funds in the Settlement
Account at all times so that any charges by KeyBank against the Settlement
Account provided for in this Agreement shall not result in a negative balance.
Charges from other processors, if applicable, including Vital will be debited
via ACH for settlement of charges monthly. Detailed back-up invoices will be provided.


 


4

















 


(b)           The
parties hereby agree that unless and until written notice changing the account
is provided to KeyBank by an authorized officer of HPS, the Settlement Account
used for deposit settlement and chargebacks will be KeyBank Account No. **********


 


(c)           In
addition to any other remedy provided by law or this Agreement, if HPS fails to
comply with Section 1.4 or this Section 1.5, or fails to reimburse KeyBank or
any of its affiliates for any loss or damage as provided for in Section 1.2(b),
except when such failure results from inadvertent error which is immediately
cured by HPS, KeyBank may, after ten (10) days’ notice to HPS, charge the
Settlement Account in any amount for charges or reimbursements provided for in
this Agreement.


 


1.6           Interchange Fees and Assessments


 


Interchange/Intrachange fees shall not exceed the
amount as set forth in, and provided by, the applicable regulations of Visa or
MasterCard which are then in effect. These fees will be settled monthly from
the Settlement Account. Reports will be provided by Vital for HPS reconcilement
activities daily. Carrying cost on the average daily balance in the Work In
Process Account will be charged a rate equivalent to the KeyBank prime rate published
on the last bank business day of the billing month.


 


1.7           Data Input


 


(a)           HPS
is responsible for the quality and accuracy of all data input to KeyBank and
Vital and will implement appropriate procedures and take all necessary action
to insure that such data is input in the proper sequence and format as
specified by KeyBank and Vital. HPS Plan shall be administered in a manner
compatible with KeyBank’s and Vital’s program. Any data submitted by HPS for
processing which is incorrect will be corrected by HPS at its expense.


 


1.8.          Record Retention


 


(a)           BPS
will require Clients to retain drafts and other evidences of cardholder
transactions for a period of three years. In addition, HPS shall communicate to
Clients the importance of providing drafts and other evidences of cardholder
transactions. HPS will also assist the Client in directing such documentation
to the appropriate area within KeyBank.


 


(b)           HPS
will retain evidence of merchant statements and supporting items relating to
the Plan for seven (7) years, except where applicable Visa, MasterCard, or
federal government agency regulations require retention for a longer period.
Reports will be stored for seven (7) years.


 












[****] Represents
material which has been redacted and filed separately with the Commission
pursuant to a request for confidential treatment pursuant to Rule 406 under the
Securities Act of 1933, as amended. 


 


5

















 


ARTICLE II

TERM


 


2.1.          Term of Agreement


 


This Agreement shall commence on the date shown above
and, unless terminated as provided herein, shall have an initial term of four
years. The Agreement shall continue for successive three year terms unless
terminated by either party (a) upon ninety (90) days prior written notice or
(b) as otherwise provided in this Agreement.


 


2.2.          Agreement Termination


 


In addition to terminating this Agreement pursuant to
Section 2.1:


 


(a)           Either
KeyBank or HPS may terminate this Agreement upon material breach of any
provision hereof by the other party hereto upon giving such other party ten
(10) days prior written notice of its intention to terminate and its reason
therefor.


 


(b)           EitherKeyBank
or HPS may terminate this Agreement immediately if such other party becomes
insolvent, files a petition in a United States Bankruptcy Court, or if a
receiver, trustee or conservator is appointed pursuant to a state or federal
court proceeding or such other party makes an assignment for the benefit of
creditors.


 


(c)           Either
KeyBank or HPS may terminate this Agreement immediately upon giving written
notice of termination in the event either party is required to discontinue its
participation in the Program based upon a final order of state or federal court
or regulatory body, unless such order is stayed pending appeal.


 


(d)           KeyBank
may terminate this Agreement immediately in the event of a breach by HPS of the
by-laws and regulations of Visa or MasterCard applicable to the services to be
rendered herein remains unremedied for a period of more than ten (10) days, and
is terminated automatically in the event of termination of KeyBank’s applicable
Visa or MasterCard license or its membership in Visa or MasterCard or upon
“deregistration” of HPS as an independent sales organization or as a member
service provider by Visa or MasterCard.


 


(e)           In
addition to other termination rights under this Section, Sponsor Bank shall
have the right, at its option, to terminate this Agreement upon either of the
following events:


 


(i)            If
any federal or state regulatory agency with regulatory authority over Sponsor
Bank requires, or requests in writing, termination of this Agreement or Sponsor
Bank’s services, in whole or in part, under this Agreement, Sponsor Bank may
terminate this Agreement at any time. Termination shall become effective ninety
(90) days after written notice unless, in the event of a “required”
termination, the regulatory agency requiring or requesting termination
specifies a termination date less than ninety (90) after written notice, in
which event the termination shall become effective as required or requested by
the agency.


 


6

















 


(ii)           If,
as the result of any court decision, change in any law or regulation, or
interpretation or ruling by any regulatory agency with jurisdiction over
Sponsor Bank that arises after the date of this Agreement (collectively called
“Applicable Law”), or Sponsor Bank’s receipt of a reasonable written opinion of
its legal counsel, Sponsor Bank reasonably believes that continued delivery of
Sponsor Bank’s services under this Agreement would violate any material
Applicable Law, Sponsor Bank shall notify Company in writing of the specific
Applicable Law or legal opinion and shall present to Company a plan to minimize
or eliminate the adverse impact resulting therefrom. Company agrees to consider
the plan, including such changes in the services as Sponsor Bank may propose,
promptly and in good faith. The parties agree to use commercially reasonable
efforts to agree upon a plan and to implement any appropriate corrective action
within thirty (30) days after such notice. If the parties hereto cannot agree
upon such a plan within said time period, either party may terminate this
Agreement, effective immediately upon written notice to the other party.


 


(f)            Upon
termination for any reason, HPS will have one hundred and eighty days to
convert to another sponsor bank, moving the applicable BIN/ICA numbers to that
new sponsor bank.


 


(h)           This
agreement may be terminated by either party upon one hundred eighty (180) days
written notice to the other party, if there shall be a change in the majority
ownership of the non -terminating party.


 


2.3.         Continuing Obligations


 


All obligations of either party incurred or existing
under this Agreement as of the time of any termination hereof will survive such
termination.


 


ARTICLE III

INDEMNIFICATION


 


3.1


 


(a)           **********


 


ARTICLE IV

MISCELLANEOUS PROVISIONS


 


4.1
..        Assignment


 


The rights, duties and obligations of HPS pursuant to
this Agreement shall not be assigned or otherwise transferred in any way
without the prior written consent of KeyBank. KeyBank may assign or transfer
its rights, duties, and obligations pursuant to this Agreement to any party
upon thirty (30) days written notice to HPS


 












[****] Represents
material which has been redacted and filed separately with the Commission
pursuant to a request for confidential treatment pursuant to Rule 406 under the
Securities Act of 1933, as amended. 


 


7

















 


4.2.          Assurances


 


KeyBank and HPS agree that the performance of services
under this Agreement is hereby made subject, without notice, to the regulation and examination of
the Comptroller of the Currency, or such other governmental agency as shall
have jurisdiction, together with any resolutions, agreements or assurances
encompassing the foregoing matters, in such form as may be required by the
Comptroller or other governmental agency.


 


4.3.          Confidentiality


 


(a)           KeyBank
will safeguard, and hold confidential from disclosure to unauthorized persons,
all data relating to the Plan submitted to KeyBank pursuant to this Agreement
to the same extent that KeyBank safeguards data relating to its own business,
unless such data is otherwise available to the public or is already in KeyBank
possession and was rightfully obtained by it from others, or unless required by
law or regulation, or by Visa or MasterCard. In such case, KeyBank will bear no
responsibility for disclosures thereof or with respect thereto, whether
inadvertent or otherwise. Nothing contained herein will preclude KeyBank
participation in Visa and/or MasterCard fraud and/or counterfeit deterrent
procedures.


 


(b)           HPS
will safeguard, and hold confidential from disclosure to unauthorized persons,
all data relating to KeyBank business received by HPS pursuant to this
Agreement to the same extent that HPS safeguards data relating to its own
business, unless such data is otherwise available to the public or is already
in HPS possession and was rightfully obtained by it from others, or unless required
by law or regulation.


 


4.4.          Due Care


 


(a)           KeyBank
and HPS will exercise due care in inputting and processing data and information
and in performing their respective obligations hereunder and each party will,
in the event of an error or omission attributable to the malfunction of
equipment which it owns or leases or to the acts, negligence or the failure of
operators, programmers, or other personnel or programs employed by them, use
its best efforts to correct such error or omission, and provide prompt notice
of the error or omission to the other party.


 


(b)           Each
party shall not be liable to the other for any nonperformance if it is
prevented from performing any task hereunder in whole or in part as a result of
an act of God, war, civil disturbance, labor dispute, or other cause beyond its
reasonable control, provided, however, that the party will use its best efforts
to restore performance.


 


4.5.          Indemnity


 


(a)           HPS
will at all times indemnify, protect and hold harmless KeyBank, and its
subsidiaries, affiliates, directors, officers, employees, subcontractors,
successors and assigns (the “Indemnified Parties”) from and against any and all
liability, claims, demands, or disputes, together with all costs, charges and
expenses, including counsel fees imposed upon or in any manner accruing against
the Indemnified Parties, arising out of or in any way resulting from, or
attributable to, (i) HPS failure to comply with any provision of this


 


8

















 


Agreement
and (ii) Vital’s failure to comply with any provision of this Agreement which,
pursuant to any written or oral agreement between Vital and HPS, Vital has
agreed to perform.


 


(b)           KeyBank
will at all times indemnify, protect and hold harmless HPS and its
subsidiaries, affiliates, directors, officers, employees, subcontractors,
successors and assigns (the “Indemnified Parties”) from and against any and all
liability, claims, demands, or disputes, together with all costs, charges and
expenses, including counsel fees imposed upon or in any manner accruing against
the Indemnified Parties, arising out of or in any way resulting from, or
attributable to KeyBank failure to comply with any provision of this Agreement.


 


(c)           HPS
will, at its own expense and if KeyBank so requests, defend any action or
proceeding brought against the Indemnified Parties in connection with any such
liability, claim, demand, or dispute.


 


4.6.          Inspection or Audit


 


KeyBank shall permit HPS or HPS designee at any
reasonable time, with prior notice and at HPS expense, to conduct an inspection
or audit of KeyBank records relative to HPS Plan and of KeyBank accounting or
auditing procedures regarding HPS Plan. HPS shall permit KeyBank designee at
any reasonable time, with prior notice and at KeyBank expense, to conduct an
inspection or audit of HPS records and materials relative to its Plan and of
HPS accounting or auditing procedures regarding its Plan. In addition, HPS will
furnish to KeyBank on an annual basis, a financial statement of HPS which has
been completed based upon generally accepted accounting principles. If KeyBank,
as a result of such inspection, audit, or review, reasonably concludes that it
is exposed to undue financial risk or exposure based on the internal controls
and security procedures of HPS, KeyBank shall notify HPS in writing of such
finding and HPS shall remedy such condition within the appropriate time frame
given the perceived risk or exposure. If KeyBank and HPS cannot reach agreement
on an appropriate remedy, either party may terminate this Agreement in
accordance with Section 2.2 hereof.


 


4.7.          Limitation on Damages


 


In any action by one of the parties against the other
arising from performance, or the failure of performance, of the provisions of
this Agreement, damages will be limited to general money damages in an amount
not to exceed the actual damages of the party. In no case will the other party
be responsible for special, incidental, consequential or exemplary damages,
except for willful breach of this Agreement.


 


4.8.          Notice Procedure


 


Notice, when required hereunder, will be sent by
Certified or Registered Mail, postage prepaid, Federal Express, Airborne
Express or a comparable overnight service, or by facsimile to the respective
parties as set out below:


 


	
  As
  to KeyBank:

  	
   

  	
  KeyBank
  National Association

  
	
   

  	
   

  	
  Mail
  Code: OH01510250

  



 


9

















 


	
   

  	
   

  	
  4910
  Tiedeman

  
	
   

  	
   

  	
  Brooklyn,
  OH 44144

  
	
   

  	
   

  	
  Attn:

  	
  Daniel
  J. Neistadt

  
	
   

  	
   

  	
   

  	
  Executive
  Vice President

  
	
   

  	
   

  	
  Fax:  (216) 813-1514

  
	
   

  	
   

  	
   

  
	
  As
  to Heartland Payment Systems, Inc.

  	
   

  	
  Heartland
  Payment Systems, Inc.

  
	
   

  	
   

  	
  343
  W. Bagley Rd., Suite 400

  
	
   

  	
   

  	
  Berea,
  Ohio 44017

  
	
   

  	
   

  	
  Attn:

  	
  Martin
  J. Uhle

  
	
   

  	
   

  	
   

  	
  President
  & COO

  
	
   

  	
   

  	
  Fax:  (440) 239-0444

  



 


4.9.          Right to Contract


 


Each of the parties warrants that neither its
execution and delivery of this Agreement nor its performance of the provisions
hereof is, or will constitute, a violation on its part of any contract,
indenture or other agreement or relationship to which it is a party or by which
it is bound, and hereby agrees that it will indemnify and save harmless the
other party from and against any loss, costs, liability, damages or expense by
reason of any claim which may be asserted to the contrary by any third party.


 


4.10.        Taxes


 


In the event that the relationship created between
KeyBank and HPS under this Agreement or any of the services rendered hereunder
or any other aspect of the relationship gives rise to any tax responsibility,
exclusive of income and similar taxes, payable to the State of Ohio, any other
state or political subdivision thereof or to the Internal Revenue Services, or
any other subdivision of the Federal government, such obligation, regardless of
whether or not assessed against, will be the responsibility of HPS In the event
that KeyBank should be required to pay any such tax obligation, HPS will
reimburse KeyBank upon demand therefor.


 


4.11.        Governing Law


 


This Agreement shall be governed by the laws of the
State of Ohio with giving effect to conflict of law rules.


 


4.12.        Counterparts


 


This Agreement may be executed in counterparts, each
of which shall be considered an original and all of which shall constitute the
same document.


 


4.13         Sub- ISO’s / Sub-Contractors


 


HPS will not enter into sales agreements or use the
services of other Independent Sales Organization (Sub-ISO) and/or Independent
Sales Representatives without the approval of KeyBank.


 


10

















 


IN WITNESS WHEREOF, the
parties have executed this Agreement as of the day and year first above
written.


 


	
   

  	
  Heartland
  Payment Systems, Inc.

  
	
   

  	
   

  
	
   

  	
  /s/  Martin J. Uhle

  	
   

  
	
   

  	
  Name:
  Martin J. Uhle

  
	
   

  	
  Title:   President and Chief Operating

  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  KeyBank
  National Association:

  
	
   

  	
   

  
	
   

  	
    /s/ Daniel J. Neistadt

  	
   

  
	
   

  	
  Name:
  Daniel J. Neistadt

  
	
   

  	
  Title:   Executive Vice President

  



 


11

















 


SCHEDULE A


 


KeyBank Merchant
Services Fee Schedule

To

Heartland Payment Systems, Inc.


 


KeyBank will pass all fees assessed to it by VISA,
MasterCard, Vital Processing Services and any other third-party entity, if
applicable, in conjunction with the Merchant Services business of HPS. Any
additional services requested by HPS will be negotiated at a future date.


 


Funding
Fees.


**********


 


Transaction
Processing Fees.


**********


 












[****] Represents
material which has been redacted and filed separately with the Commission
pursuant to a request for confidential treatment pursuant to Rule 406 under the
Securities Act of 1933, as amended. 


 


12

















 


FIRST AMENDMENT
AGREEMENT


 


This First Amendment Agreement (herein called “Amendment Agreement”) is entered into
effective as of the date specified below by and between KEYBANK NATIONAL
ASSOCIATION, (“KeyBank”), with its main office at 127 Public Square, Cleveland,
Ohio 44114-1306, and its merchant services administrative offices at 4900
Tiedeman Road, Brooklyn, Ohio 44144 and HEARTLAND PAYMENTS SYSTEMS, INC., with
its office at 47 Hulfish Street, Suite 400, Princeton, New Jersey 08542 (“HPS”)
and modifies, and shall become a part of, the Merchant Processing Agreement,
dated as of April 1, 2002, between HPS and KeyBank (as amended, herein called
the “Agreement”).


 


WHEREAS,
KeyBank and HPS desire to amend the Agreement in the manner set forth below regarding the Card Program described therein.


 


NOW
THEREFORE, for valuable consideration received, the parties hereto agree as
follows:


 


A.            Definitions. For purposes of this Amendment Agreement,
all defined terms used herein shall have the meaning set forth in the Agreement
unless otherwise expressly defined herein.


 


B.            Amendments.


 


(1)           The initial term of the Agreement is hereby extended for three years.
Thus, Section 2.1 of the Agreement is hereby amended to read as follows:


 


“2.1.
Term of Agreement. This Agreement shall commence on the date shown at
the beginning of the Agreement (April 1, 2002) and, unless terminated as
provided herein, shall have a term of seven (7) years to continue until April
1, 2009. The Agreement shall continue for successive three (3) years terms
after said initial term, unless terminated by either party (a) upon ninety (90)
days prior written notice or (b) as otherwise provided in this Agreement.”


 


(2)           For purposes of Schedule A attached to the Agreement, and paragraph 2
in said Schedule A, the minimum monthly billing of Transaction Processing Fees
shall apply to transaction fees only and not to Settlement Account Interest,
effective as of December 1, 2004, and continuing through the end of the term of
the Agreement.


 


(3)           Schedule A to the Agreement is further amended by adding the following
terms:


 


“ACH Processing Fees.


    **********


 












[****] Represents
material which has been redacted and filed separately with the Commission
pursuant to a request for confidential treatment pursuant to Rule 406 under the
Securities Act of 1933, as amended. 


 


13

















 


C.            Miscellaneous.


 


(1)           Modifications and Changes. This Amendment Agreement may only be amended
by a written document signed by each of the parties. Neither party shall be
deemed to have waived any of its rights, powers or remedies hereunder unless
the waiving party approves such waiver in writing.


 


(2)           Severability; Headings. If any provision herein is held to be
invalid or unenforceable for any reason, the remaining provisions will continue
in full force without being impaired or invalidated in any way. Headings are
for reference purposes only and in no way define, limit, construe or describe
the scope or extent of such section.


 


(3)           Mutual Representations. HPS and KeyBank each represents and warrants
that (i) it has the power to execute and perform this Amendment Agreement; (ii)
the execution and performance of this Amendment Agreement by it has been duly
authorized by all necessary corporate action; and (iii) this Amendment Agreement
constitutes a legal, valid, and enforceable obligation of such party.


 


(4)           Governing Law. This Amendment Agreement and the rights and
obligations of the parties hereunder shall be performed, construed, and
interpreted in accordance with the laws of the United States and the State of
Ohio, notwithstanding any conflict of laws doctrine.


 


(5)           Ratification. Except as otherwise amended hereby, the
Agreement is hereby confirmed in all respects and shall remain in full force
and effect.


 


IN
WITNESS WHEREOF, the parties hereto have executed this Amendment Agreement,
effective as of November 1, 2003.


 


	
  KEYBANK

  NATIONAL ASSOCIATION

  	
  HEARTLAND
  PAYMENTS SYSTEMS, INC. 

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Daniel Neistadt 

  	
   

  	
  By:

  	
  /s/
  Martin J. Uhle

  	
   

  
	
   

  	
  Daniel
  Neistadt

  	
   

  	
   

  	
  Martin
  J. Uhle

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Executive
  Vice President

  	
   

  	
  Title:

  	
  President
  and C.O.O.

  	
   

  
								



 


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